LEADING

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HARVEY GULF INTERNATIONAL I PROFILE

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From its base in New Orleans, Harvey GulfInternational is operating the safest, greenestand most efficient deep water marinetransportation vessels in the region. “Wehave something for everybody and delivera better job than our competitors,” saidvisionary Chairman and CEO ShaneGuidry. Report by Colin Chinery.

Challenge and responseBut from 2014, severely depressed oil prices led to exploration andproduction companies slashing the number of offshore explorationand drilling projects in the Gulf of Mexico. Substantial drops in vesselutilisation and day rates followed, and Harvey Gulf moved quicklyto take measures to weather the downturn, including idlingunprofitable vessels and cutting $87 million in costs. Since May 2018, following a filing under Chapter 11 – a form of

bankruptcy that involves a reorganisation of a debtor’s businessaffairs, debts and assets – Harvey Gulf’s restructuring plan hasconverted nearly $1 billion in secured debt into equity “We started off the process two years before we had a payment

due in 2019. Being proactive meant that we didn’t get near to thatpoint,” said Mr Guidry. “We have restructured the business and eliminated just short

of $1 billion of our debt. That process has been completed; weare up to 60 new customers and have a very strong balancesheet. Overall, it puts us in a position to acquire assets and consolidate other companies.”

Company history reaches back to 1955, when Captain NumaGuidry assembled a f leet of inland towing vessels to service theGulf Coast transportation market. Ten years later, his two sonsjoined the family enterprise, helping expand the company –renamed Harvey Gulf International Marine – into the offshoreocean towing and rig-moving industry. Through the late 1990’s, it was operating a f leet of vessels

servicing jack-up and semi-submersible drilling rigs, bulk cargobarges, large structures and facilities, as well as liquefied natural gas-filled barges from Louisiana to ports in the Caribbean, US EastCoast and US Gulf of Mexico.

Going ultra deepIn 1988, Shane Guidry had become the third generation of thefamily to operate the business, assuming the roles of Chairman andCEO in 1997. Over the next years, the business transitioned fromfull-service towing operator to offshore towing specialist, witha focus on towing large jack-up and semi-submersible rigs inthe deep-water and ultra-deep waters of the Gulf of Mexico.

When the ripples of the 2014 oil crisis first surfaced at thestart of a 60% price collapse, Harvey Gulf Internationaltook immediate re-structuring action.

“We started the process early. We didn’t want to do what other com-panies are doing by just waiting to the last minute,” said Chairmanand CEO Shane Guidry. “We are a proactive company, not reactive.”Dating back more than half a century, the New Orleans-headquar-

tered business specialises in providing leading-edge fast supply andmulti-purpose support vessels for deep water operations. Innovative features and outstanding operational fleet perfor-

mance, together with a strong emphasis on HSE preservation andmanagement, have made it a byword in the Gulf of Mexico and theCaribbean sectors.

F RO M T H E F RO N T

The Harvey Champion, the third “Tigar Shark” vesselconstructed for Harvey Gulf International Marine LLCwas completed and delivered in August 2012

The Harvey Energy, the first US Flagged LNG powered offshore supply vessel

The Harvey Stone is a multi-service vessel designed for operational support for the FPSOPort operations facility in Port Forchon, Louisiana

Harvey Freedom conducting cargo ops at Ursa

Harvey Gulf has been managed from the heights of the market,in downturn and now into the recovery, “and we still have not hada recordable incident,” said Mr Guidry. “That’s because of the waywe involve ourselves every day and manage the business as a team.No one else can say that. And we also deliver a better job thanour competitors.“Furthermore, over the last three years and three quarters during

the downturn, my team and I have delivered an average EBDITAof 55% annually to our shareholders.”

A record of firstsThe first US vessel operator to contract for construction of vesselscapable of operating exclusively on natural gas, Harvey Gulf earlyin 2018 took delivery of its fifth LNG dual fuel offshore supply vessel.

And, in a double first, the company concluded third party trials atits Port Fourchon site – the first LNG marine fuelling facility in theUnited States – for America’s first offshore LNG bunkering barge. “In another first for Harvey Gulf, we are building a 4,000 cubic

meter LNG articulated tug and barge to deliver LNG as a main fuelsource to cruise ships in South Florida,” said Mr Guidry. “The world’sfirst LNG ATB bunkering vessel will be delivered to Harvey and itsmajority partner in this project, QLNG Transport, on January 21st2020. Harvey will be the operating partner.” Harvey Gulf continues its commitment to environmental pro-

tection by becoming the first to build USA flagged vessels thatcan run entirely on natural gas, meeting not only the highestemissions standards that exist today, but also anticipatinghigher standards yet to be set.

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HARVEY GULF INTERNATIONAL I PROFILE

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As part of this specialisation, inland towing vessels were soldand replaced with larger, more powerful offshore towing vessels.New and repowered equipment were also added to the offshorefleet to enable the specialised services needed for deep-waterrig towing.With a reputation for operating the most powerful towing

vessels in the Gulf of Mexico, and anticipating the future needfor other types of vessels to support deep-water drilling andproduction, Harvey Gulf began ongoing f leet expansion toinclude OSVs in 2003.Characterised by large-size, high-cargo capacities, and sophisti-

cated electronics and navigation systems, these range from 175-340 ft, all SOLAS and ABS Classed with DP2 certification. More recently, this fleet has further expanded to include vessels

capable of supporting deep-water rig mooring operations withreel spooling units, as well as surveying activities, offshore andsubsea construction, pipeline inspection and repair and divesupport services.

Sought after fleetHarvey Gulf International Marine’s Jones Act-compliant multi-purpose support vessels are performing a broad spectrum ofsubsea installations and removals, inspection, repair andfloatel services. “We have one of the most sought after f leets in the Jones Act

world today,” said Mr Guidry.In 2008, Mr Guidry, together with New York-based private equity

firm The Jordan Company, acquired Harvey Gulf from other membersof the Guidry family with the goal of expanding both fleet and servicesto meet evolving customer needs while maintaining high-levelperformance and safety standards. And these safety and optimumfunctional efficiencies are exceptional. “We stand for safety and operational excellence,” stated Mr

Guidry. “At the height of the market we had 55 boats on long-termcharter for three years and more. And year-on-year, those 55boats consistently worked 99.2%, leaving just 0.8% maintenanceand downtime.”

Harvey Liberty transferring liquidmud to deep-water

Harvey Gulf LNG bunkering facility in Port Fourchon, Louisiana. This was the first LNG Marine Bunkering facility in the United States

The first of two large constructionvessels delivered in November 2017

Harvey Liberty conductingcargo ops at Ursa

Harvey SubSea daily safety meeting with customer DOF Harvey office lobby NOL

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“LNG equipment is a very expensive proposition, few people aredoing it, and there is very little history of operating performance,”suggested Mr Guidry. “But because we stepped out there early witha team that over the years researched and learnt in different partsof the world, we were able to capitalise ahead of our competitors.And today we are so far ahead.”

Leaders leadShane Guidry leads from the front, a details and vision man whoarrives at his desk at six in the morning, often working an 80-hour week. “There’s a myth out there that this company is so dependent

on me. That’s 50% true and 50% not true. No company is solelydependent on one person.“Companies are dependent on an organisational structure, and

the ones that survive for a long period of time are those that havea leader who can maintain, on a daily basis seven days a week,the organisational structure that delivers the product servicethat meets customer wants and needs.

“You have to insert yourself in all parts of your business. Youjust don’t manage from a piece of paper or a group of suits withties on; you need to get out there and go see for yourself andinteract with your everyday employees. For me, it’s interactingwith the guy who sweeps the floors, the Captain on the bridge andmy executives in the office. I’m interactive with everybody.”Over the last 10 years, Harvey Gulf’s operations have spanned

the US – including North Slope in Alaska, while internationally thecompany has worked in Kenya, Ghana and Mozambique in Africa,as well as Cyprus, Mexico, Trinidad and French Guiana. With HarveyGulf ‘going global’, targeting new markets as major companies arestarting to commit funds to new drilling campaigns, Mr Guidrybelieves the main challenge over the next 24 to 36 months willbe access to capital.“I think investors out there need to be more mindful of looking

to merge their businesses with stronger management teams thatare producing stronger and safer returns for their shareholders.But looking at the sector overall, I see better times in 2019 andeven better in 2020.” n